eBook Wars: Browser Wars All Over Again

At the IDPF Digital Book 2012 Conference earlier this week, Michael Tamblyn, who's Kobo's Executive Vice-President for Content, Sales and Merchandising, gave a status report on his company's market success and progress in implementing an EPUB 3-compliant eReader. Mr. Tamblyn said that because there are "a half-dozen ways to do anything in EPUB 3," it's essential that his developers test Kobo's EPUB 3 prototype using live samples, but his company is having difficulty getting enough document samples for testing. He also said that some publishers are waiting to actually get commercial EPUB 3 readers in-house, so that they can develop their documents to use the features actually implemented by eReader developers.

The next day, I spoke to a manager from a document conversion and app development company on the BEA show floor. He said that his company recommends to publishers that they use EPUB 3  as the basis for creating eBooks. I asked, "But what about Amazon? They don't use EPUB 3." The representative said that Kindle Format 8 is "very close" to EPUB 3, and that Amazon might adopt EPUB 3 in the future. In any event, he said, it's fairly easy for his firm to convert EPUB 3 to KF8.

The era of "Browser Wars"

I came back from New York with a bad case of déjà vu. Anyone who was involved with the Internet from 1995 on remembers "Browser Wars," the battle between Netscape and Microsoft to dominate the web browser market. The engineering team that developed Mosaic, the first graphical web browser, at the University of Illinois, moved to Silicon Valley and wrote a new browser, code-named Mozilla, that became the Netscape browser. Netscape quickly became the most popular Internet software ever released to that date. Then, Microsoft licensed the original Mosaic code from the University of Illinois and released its own browser, called Internet Explorer.

Early on, Netscape introduced new tags and functionality to its browser at a fast clip. Some of these tags, such as frames, gave web designers more options for creating web page layouts, but the tags were implemented without being adopted by the World Wide Web Consortium (W3C,) the international standards-setting body for the Web. Microsoft adopted some of Netscape's tags and added many of its own. However, even when it adopted a Netscape tag, it would often adopt a different set of attributes (the settings that tell the tag what to do.) There were also variations in how browsers rendered tags: The exact same web page, using the same HTML tags and attributes, in two browsers that supported all the tags and attributes used in the page, could look different in the two browsers. For example, in one browser, the page might be displayed with a background color that bled all the way to the edges of the window, while in another browser, the same page might be displayed with a white border around the edges.

It wasn't only HTML that got "innovated" to pieces. The same scripting language got two different names--JavaScript at Netscape (where Brendan Eich invented it), and JScript at Microsoft. As with HTML, the two companies' implementations were different in subtle (and sometimes not so subtle) ways. This was the era of "Looks best in (Browser X)" and "We prefer (Browser X)". In some cases, web pages wouldn't even open in some browsers, and the user would be told to use or install a different browser.

Browser developers encouraged these differences in order to lock customers in, but they were a nightmare for website designers, who had to design different versions of their sites for different browsers, and even for different versions of the same browsers. Pressure from designers and software developers on browser vendors and standards organizations reduced, but to this day still hasn't completely eliminated, the requirement to do things in different ways for different browsers. The W3C took charge of defining new versions of HTML and pushed vendors to stop implementing their own new tags until they'd been reviewed and accepted by the W3C. The W3C also adopted Cascading Style Sheets (CSS,) which over the years have made it easier to tightly define the layout of web pages that work across browsers. Ecma International (formerly the European  Computer Manufacturers Association) took over standardization of JavaScript, and changed the name of the standardized version to ECMAScript.

However, even with all these standardization efforts, supported in some cases by companies whose annual revenues exceed those of the entire book publishing industry, there are still incompatibilities among browsers, and even among versions of the same browsers. For example, Mozilla has JavaScript in its Firefox browser, and Microsoft still has JScript in its Internet Explorer. Both are compatible with ECMAScript at a basic level, but both have additional features that are incompatible with each other.

From Browser Wars to eReader Wars

eBook designers have a variety of formats that they have to work with: Amazon's .AZW (based on the Mobipocket format acquired by Amazon) and Kindle Format 8 (based on HTML5 and CSS with extensions), EPUB 2.X, Apple's iBooks (EPUB 2 .X with Apple's extensions), Kobo Color Content (EPUB 2.X  with Kobo's extensions,) Nook Digital Replica Plus (EPUB 2.X with Barnes & Noble's extensions,) EPUB 3 (HTML5 and CSS3 with the IDPF's extensions) and PDF.

To eBook designers, the word "extensions" is a synonym for "incompatibilities." Two different eReaders may perform the same functions, but if the tags or attributes that tell the eReaders what to do are even slightly different, eBook designers will have to either design around the differences or not use the functions.

Can we draw lessons for the eBook industry from the Browser Wars years? I think that we can:

1. Incompatibilities among eReaders from different vendors, and even among different generations of eReaders from the same vendor, are inevitable and won't go away.
2. Amazon will adopt EPUB 3 48 hours after Apple provides full support of Flash in iOS. In other words, it'll never happen. Amazon's eBook formats are strategic technologies for the company, and it won't allow any competitor or group of competitors to dictate how a strategic technology must work.
3. Despite the best of intentions, browsers' implementations of HTML5, CSS3 and JavaScript are still incomplete, although they're much less incompatible than they once were.
4. EPUB 3 is based on HTML5 and CSS3, and most eReader developers will either base their software and devices on an existing web browser to avoid "reinventing the wheel," or will use the customer's existing web browser and then support the EPUB 3 extensions with JavaScript. Either case makes EPUB 3 subject to lesson 3 above.
5. In order to minimize time and cost, eBook designers and developers will inevitably gravitate to a "lowest common denominator" approach, where they'll either only use features supported compatibly by the largest number of eReaders, or will design eBooks so that features that aren't supported by a particular eReader are either simulated or ignored without crashing.

Startups: Getting back to first principles

It's become so easy and inexpensive to launch a software or Internet-based startup that the current "leading edge" of thought is that startups should "fail fast" (make mistakes early) and then "pivot" (adopt a different strategy, or even develop a different product or service) until they land on a viable market opportunity. We've lost sight of some fundamental first principles that startup teams should think about before they write a line of code. These are first principles in the vein of "The Art of War"--how likely are you to survive engagements with customers and competitors.

For example, direct, head-on competition with entrenched competitors is likely to result in failure. If you're building a new search engine, you're likely to fail (see Cuil and endless other companies) unless you've got a parent company that makes more money than it knows what to do with (see Bing.) The best outcome in this case is that you'll develop some unique and interesting technology, and larger competitors will find it cheaper and easier to buy it from you than to build it themselves.

If you're planning to go after much bigger competitors, misdirect them and keep your mouth shut about your true intentions until you're too big to kill. Netscape was growing incredibly rapidly as a browser company, but Microsoft was largely ignoring it. However, as soon as Netscape announced that it was positioning its browser for running applications on any operating system, Microsoft saw it as an existential threat and did everything it could to destroy the company. Since Netscape still had tiny revenues, Microsoft could "cut off its air supply" by giving its browser and Internet servers away. Had Netscape kept quiet about its intention to turn its browsers into an application platform until it was big enough to withstand attacks from Microsoft, it would have survived. (AOL, which acquired Netscape, has abandoned all use of Netscape's brand name and products, and moved out of the last of Netscape's buildings in Silicon Valley in late August.)

Google learned from Netscape's demise and kept quiet about its long-term plans. It was a search engine, and search was at best a minor part of Microsoft's business. It generated advertising revenues, but Microsoft made its money through selling software, so that wasn't perceived as a threat, either. The first iteration of Google Apps was seen as a joke by Microsoft and dismissed. Google hired Andy Rubin, the founder of Danger (the developer of Sidekick mobile phones, which was subsequently acquired by Microsoft) and adopted the funky smartphone operating system (Android) that he had been working on. Again, it was under the radar and not worth Microsoft's time. By the time Microsoft fully realized how many of its businesses were under attack, Google was too big for Microsoft to kill.

If you're going into any market dominated by "old media" companies, position what you're doing as a way for them to retain market share and/or make more money, and make sure that they agree--otherwise, they'll kill you. Napster completely disrupted the business models of the big record companies, and they sued Napster out of existence, but not before they were crippled by music sharing. Apple stepped in and offered the record companies a way to make money from the growth in usage of digital media players. The record companies bought in, which ultimately resulted in Apple becoming the world's largest seller of music, and made the record companies dependent on Apple for their survival.

If your business depends on information or support from entrenched companies, you're going to have an uphill battle. Steve Huffman, one of the founders of Reddit, set off to create an airline ticket comparison service, Hipmunk, that makes it easy to find the lowest fares. This, however, threatens the airlines, which see it as decreasing their potential profits. So, Hipmunk has struggled to get access to the flight and pricing information that it needs for its service. The company has launched, but its most likely exit strategy (if it survives) is to be acquired by a search engine or a larger travel service.

When startups take on entrenched competitors, they almost always roll out the David and Goliath story. The reason that story has so much resonance is that the little guy beat the big guy, when in the real world, the big guy almost always wins. The lesson for startups is to avoid taking on the big guys until you're big enough to fight them as an equal.

Don't telegraph your moves

There once was a company named "Play" that developed what was, for the time, a revolutionary video processing system called Trinity. It could capture and switch video like professional video switchers that cost ten times as much. For three years, Play took Trinity to the NAB Show, each time promising to ship it before the end of that year, but never managing to do so. So, year after year, Play went to NAB, always showing a few more bells and whistles, but not a shipping product. By the time Play finally completed development and shipped Trinity, most people in the television industry has stopped paying attention. Play eventually went out of business, although some of its concepts live on in products from Newtek and Adobe.

Back in 1995-96, Netscape told the world that it would make Microsoft Windows obsolete by moving applications from the operating system to the browser, which would make the applications operating system-neutral. This was tantamount to waving a red flag in front of a bull; in this case, the bull was Microsoft. We all remember what Microsoft did in response--everything possible, both legal and illegal, to crush Netscape. For all its publicity and hype, Netscape wasn't big enough to withstand Microsoft's onslaught. The company was sold to AOL at a good price considering the situation, but it's fairly clear that Netscape would have eventually failed had AOL not acquired it.

RED, the digital cinema camera company, has fallen into the same trap as Play with its Scarlet camera. In 2007, RED started talking about Scarlet, a camcorder that would provide true HD output at a cost around $3,000, which at the time was where prosumer SD camcorders were priced. Then, in early 2008, Jim Jannard, RED's founder, announced that Scarlet was going to become a video-capable DSLR. In November 2008, RED showed off non-working prototypes of Scarlet and its big brother, Epic, but they didn't ship anything.

As soon as RED started talking about making Scarlet a DSLR, companies that already made DSLRs like Canon and Nikon, as well as companies that were planning to get into the DSLR business like Panasonic, started to pay very close attention. In November 2009, RED made the rounds again, this time with yet another non-working prototype of the Scarlet, but Canon, Nikon and Panasonic all had DSLRs in the market that could do HD video, all for less than the (now increased) price of the Scarlet. This March, you'll be able to buy a Canon Rebel T2i with excellent video capabilities for $799 without lens. Sony, which had been holding back, now plans to release two DSLRs with AVCHD video by the end of the year.

By making premature announcements, RED educated its competitors. RED may have assumed that its competitors were too incompetent or too hidebound to respond, but they were wrong. At best, the Scarlet is going to end up as a niche product rather than the revolutionary change in camera design that Jim Jannard envisioned.

Now, Microsoft itself may be falling into the same trap with Windows Phone 7 Series. At the Mobile World Congress a couple of weeks ago, Microsoft previewed its new operating system for smartphones, a radical departure from previous Microsoft offerings. The problem is that smartphones that run Microsoft's new operating system won't ship until the end of 2010, thus giving Apple, Google, RIM and other competitors nine months to respond. Microsoft used to be able to get away with it--their preannouncements would cause FUD (fear, uncertainty and doubt) in the minds of potential buyers of other products. However, that was when software development took years; now it takes months. By the end of the year, it's likely that the advancements that Microsoft demonstrated will be integrated into its competitors' platforms, and any real competitive advantage that it might have had will be lost.

The lesson? Don't telegraph your moves. Announcing products and strategies too early will only educate your competitors and frustrate customers, not create FUD.

Motivation vs. fixation

Steve Tobak of BNET wrote yesterday about Steve Jobs's remarks about Google last week at Apple's post-iPad "town hall", and used them as an example of the value of having an enemy in order to motivate the troops. As someone working at Netscape when Microsoft declared us Enemy #1, I saw just how motivating having an enemy can be. At the same time, it's extremely important to differentiate between motivation and fixation. Microsoft focused so hard on killing Netscape that it repeatedly crossed the line from honest competition into using its monopoly position illegally. That decision brought both the U.S. Justice Department and European Union down on the company. The result is that Microsoft finds its hands tied whenever it tries to exercise its power.

It's also important not to fixate on a single competitor and ignore other risks. While Microsoft was pounding Netscape into the ground, Google was just getting started. Microsoft ignored Google, but Google's plan from the beginning was to eventually take on Microsoft, which it's successfully doing. Now, Google is too big for Microsoft to kill, and Microsoft's playbook, which was written in the Netscape days, is out of date and ineffective.

My last point is that it's better to fixate on customers than competitors. If you consistently satisfy customer needs, anticipate their future needs and are responsive when they have problems, you're going to be successful. I think that's the real secret of Apple's success with the iPod and iPhone. While competitors were focusing on adding more codecs to their MP3 players, Apple was focused on the user experience. Instead of trying to improve on the BlackBerry model as other smartphone companies were doing, Apple again focused on the user experience.

In short, it's important to understand your competitors but not fixate on them. Fixating on customers will almost always result in a better outcome.

Nothing Lasts Forever: The 12 Most Tarnished Tech Brands

Harry McCracken published his list of the 12 most tarnished tech brands on his Technologizer blog. Some of them are near-forgotten, such as AltaVista, Commodore, CompuServe, Netscape (both of which were driven into the ground by AOL) and Packard Bell. A few are once-well-known brands that are now used by anyone with the money to license them, such as Polaroid and Westinghouse, and one, AT&T, is used mainly for convenience by its acquirer, SBC. One brand that I would have included is Compaq; once one of the most powerful companies in the computer industry, the Compaq trademark is now used to brand HP's cheapest and junkiest PCs.

The list reminds us that even the biggest and most powerful companies can eventually fall apart and become irrelevant. MySpace is heading down this path, and Yahoo! isn't too far behind. Motorola has to prove that the Droid isn't a one-shot wonder like the RAZR was in order to keep off the list. Nortel will certainly be on this list if its trademark continues to be used. Alcatel-Lucent fits the list as well, since it probably won't survive in its current form for much longer.

Who do you think is a candidate for ending up on the scrap heap in 2010?

Don't cry for me, innovation

Today's New York Times website has an article on the importance of maintaining investments in innovation, even with an economic downturn. My question is, what innovation? I track a variety of technology-related industries, and I've been hard-pressed to find anything recently that qualifies as a real innovation. One of Google's most exciting recent innovations is the ability to read and index text in images of pages, such as in PDF documents. I worked for Palantir, the company that invented most of that technology, 23 years ago. Or how about Google Chrome, which was all the rage a few weeks ago? It's largely based on open-source Webkit technology and a JavaScript compiler that Google acquired, rather than developed in-house. And, it's a browser. I was in the browser business near the beginning as well, at Netscape, 13 years ago.

The problem isn't encouraging innovation in an economic downturn, it's producing true innovation, period. Economic downturns often help, rather than hurt, innovation. Just as forest fires burn away the underbrush that stifles forest growth, so companies are forced to focus on products and services that really matter. The survivors in each product segment become clear, and the people who work for the losers either take their ideas to the winners or go start their own companies. A new wave of start-ups is born, and some of them do really interesting things, rather than merely cloning what someone else is doing with a minor twist.

I say let the big companies batten down the hatches, and let the start-ups without business models die off. The big guys will do what they've been doing for a long time, which is buying their best ideas from others. So long as there's venture capital and engineers & scientists driven to build the next big thing, innovation will take care of itself.

Losing a Legend

By now, you undoubtedly know that George Carlin died last Sunday. So what is some technology wonk doing writing about him? About ten years ago, after I left Netscape, I ran an Internet radio website called Comedyaudio.com. It was the first 24-hour Internet comedy radio station. For a while, we ran commentaries from Merle Kessler (Ian Shoales) and Kelly Carlin-McCall, George Carlin's daughter. I never had the opportunity to meet George, but I spent some time with Kelly and some of her relatives. She told me stories about growing up with George and Brenda (George's first wife and Kelly's mother), most of which were hilarious.

Brenda died of cancer in 1997, a day before George's 60th birthday. The loss struck both George and Kelly incredibly hard; this was a very close-knit family that had gone through things that most people couldn't even dream of. It seemed to me that George's comedy and commentary turned darker after Brenda's death, but it was something that he never talked about on stage.

I wish Kelly and Sally Wade, Kelly's stepmother and George's surviving second wife, my deepest condolences. I know that George loved his family very deeply, and there will be no way to replace him. The world has lost a genius, both a comedy legend and, in his later years, a social commentator of the first order.

Comedy seems to have lost its ability to comment on deeper social issues. When comedians like Carlin, Richard Pryor and Lenny Bruce used offensive language, they used it to make important points, not just to shock or titillate. Jon Stewart and the Daily Show team take on politics, but it's inconceivable to me that they'd talk about religion like George Carlin did. Bill Maher is closer, but even he doesn't have Carlin's intensity or, in Carlin's later years, willingness to tear down his audience in order to make an important point.

I can't help but compare the coverage given to the recent deaths of Jim McKay, Tim Russert, and now, George Carlin. I was deeply disappointed by the paucity of coverage of McKay's death; the network that did the best job wasn't ABC, where McKay spent almost his entire career, but CBS, whose news and sports divisions are run by Sean McManus, McKay's son. Carlin has gotten a few minutes on the news here and there. Russert, on the other hand, got wall-to-wall coverage on all the 24-hour newschannels, including six straight hours on MSNBC and a half-hour of prime time on NBC. With all due respect, McKay and Carlin deserved better.